“You can bank on it”: Covid-19 Tales by Moonlight

By Salewa Olawoye, York University, Toronto, Canada

Image Credit: Adobe Stock

Growing up, there was a popular Nigerian television show called “Tales by Moonlight”. It gave stories from an African perspective that provided lessons, especially moral lessons, to the listeners. In recent times, the world experienced a pandemic that has opened up various opportunities of lessons for the world to learn. The recent global pandemic, Covid-19, changed the world in a lot of ways. Countries experienced extended preventative measures such as lockdowns that were thought to last for 2 weeks and every part of the society was affected. The pandemic ushered in an era of people getting sick, some others dying, many losing their jobs or working from home, businesses folding up and a general feeling of gloom and despair. Economic effects include supply interruptions through a reduction in hours worked and supply chains were affected, which influenced inflation. As a result of these and other Covid related issues, life as we knew it changed.

The effects of this global pandemic on developing nations differed yet the severity of the situation was not lost on many countries. It did not matter if they had proper health systems or not, the world felt the effects of Covid-19 and systems had to be adjusted to survive the pandemic. In the developing world, there was a general feeling of fear and doom as the devastating effects of Covid-19 in the world were publicized. In a CNN interview, Melinda Gates talked about Covid-19 being devastating in developing countries with bodies being littered around, and predicted catastrophic effects in countries in Africa. The continent was expected to produce the most devastating casualties of Covid-19 in the world.

Despite these predictions, countries in Africa survived the pandemic much to the surprise of the rest of the world. It almost seemed like can anything good come out of Africa? While the rest of the world embraced her entertainment (the music and movies) on social media, everything else seemed to be shown in a negative light during the pandemic. However, African countries survived the pandemic and a lot of the ways of survival need to be studied along with the survival strategies of the rest of the world. Countries in Africa provide a great case study because each country is different in terms of development, structures and systems. While non-pharmaceutical Covid-19 preventive measures such as lockdowns to flatten the curve were easier in countries with a more developed system like South Africa, others like Nigeria had to reopen before flattening the curve as for quite a number of people who depended on daily physical work to survive, hunger was a bigger pandemic than Covid-19. In all countries, monetary and fiscal policies were used to regulate the economy from the various effects of Covid-19.

In studying monetary policies around the world, it is quite common to focus on the West. If this study is focusing on developing countries, a heavy focus is placed on Latin American countries and Asian countries. African countries are largely underemphasized. When studied, the complexities in African countries and different structures that exist in them are often ignored. However, these complexities and differences make African countries an interest study in the fight against Covid-19. Using Sub-Saharan Africa as a monetary policy case study, we see that countries in Africa have different monetary regimes. Some countries have independent central banks while others belong to one of two monetary authorities, the Central Bank of West African States (BCEAO) or the Bank of Central African States (BEAC). Our book, Covid-19 and the Response of Central Banks: Coping with Challenges in Sub-Saharan Africa, captures these differences in African countries and how various countries adopt various forms of monetary policy to suit issues in a country and the country specific effects of these policies adopted. To achieve this, eight Sub-Saharan African countries are analyzed. They include Nigeria, Cote d’Ivoire, Ghana, Senegal, the Republic of Congo (Congo-Brazaville), Cameroon, Sierra Leone and the Democratic Republic of Congo (Congo-Kinshasha).

It is not uncommon to hear the statement “Africa is not a country” used to highlight the various countries and their differences within the continent. This book further fuels this stance through the study of Covid-19 and monetary policy in Sub-Saharan Africa. It highlights the different monetary policies and their effects based on whether countries have an independent monetary authority or if a country belongs to a monetary union. From a central banking perspective, we see how different systems produce different outcome and how these different countries in Africa tackled the challenges that came with Covid-19. We see lessons from African countries for Africa and the world.

COVID-19 and the Response of Central Banks: Coping with Challenges in Sub-Saharan Africa Edited by Salewa Olawoye, Assistant Professor, York University, Toronto, Canada is available now.

Read the introduction and other free chapters on Elgaronline

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